Suppose That Dave's Camera Shop Operates in a Competitive Market

question 158

Multiple Choice

Suppose that Dave's Camera Shop operates in a competitive market for cameras, which of the following statements is (are) true?
(i) he can maximise profit by raising his prices
(ii) he can maximise profit by altering the quantity of cameras that he supplies
(iii) he will be able to earn a profit only if he differentiates his cameras from the rest of the market

• A)(i) only
• B)(ii) only
• C)(i) and (ii)
• D)(iii) only

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Definitions:

Price Supports

Government interventions in markets to establish or support the price of specific goods, often to ensure that farmers receive sufficient income.

Acreage Allotments

Regulatory measures that limit the amount of land that can be used for farming certain crops to control supply and stabilize market prices.

Price Supports

Government interventions to maintain the market price of a commodity at a certain level to encourage production and protect farmers.

Farm-Family Income

The combined income of all members of a family who reside on a farm, from both farming and non-farming sources.